The Risk of Foreign Currency

EurUsd For now Euro/US Dollar remains locked in a 250 pip range between 1.4210-1.4460, and this morning's rally to 1.4375 levels has helped pulled the 14-day RSI back above oversold 30 levels seen at the end of last week.

1.4460 should pose a significant barrier to any further rallies, and any break above there would face further supply at 1.4500, 1.4600, and a major hurdle at 1.4685.

On the downside, today's lows at 1.4258 provide weak near-term support, with the 200 day moving average coming in below at 1.4232, and range lows at 1.4210 the major level to watch.

GbpUsd The end of last week saw GBPUSD break 1.5925 support to touch 1.5833 lows, but this move was quickly negated by a strong rebound to 1.6236 highs on Thursday, and stochastics point to further bullish momentum to come.

The pair now sits comfortably back above the 200 day moving average (comes in at 1.6085), but the 1.6248 level (Dec 18 highs) should form decent resistance on the first test.

Expect any break above there to face very little significant resistance until 1.6335 (100 day moving average), and above there the 1.6400 psychological barrier and 50 day moving average.

Immediate support should now come in at 1.6059 (today's lows), and 1.5833 (Dec 30 lows).

UsdJpy Despite the short-term bullish momentum which took USDJPY above 92.50 levels at the end of last week, the pair has still not staged a convincing breakout from the major downtrend channel that has been in play since mid 2007.

Expect plenty of offers around 93.00-20 zone, and only a daily close above the 93 handle to suggest a further move higher.

Thursday's 91.92 lows provide first support; watch for a break below 91.10 to indicate a resumption of the larger downtrend.

UsdChf Range-trading prevails in USDCHF between 1.0280 and 1.0425, but the break above the 100-day moving average (1.0301 currently) does seem to favour further USD strength from here.

Next levels to watch outside the range are 1.0508 key high and beyond there the 1.0700 major resistance (38.2% correction of the move from 1.1970 down to 0.9918).

Near term support stands at 1.0320 ahead of 1.0220.